One of the most sure-fire ways to build your assets is to invest, whether it’s in stocks, bonds, mutual funds, real estate or business. But this is one of those areas where the phrase “it takes money to make money” is absolutely true – you can’t grow your money through investments until you have money to invest! There are a few ways to get money for investment, some simpler than others:
Savings. You should already be building your savings and, once you register a healthy number in your account, it’s time to take some of that capital and invest it in something that will give you a higher return on your money than the interest from savings. Even a smallish investment – like putting a few thousand dollars into a mutual fund – will earn more for you than money that’s just sitting in the bank.
Sell something. If you have a pile of money tied up in a motorhome you rarely use, or a timeshare that costs more than you get out of it – or any other asset that isn’t paying decent dividends – sell it, and use the money for something with a decent return. Your money can;t work for you if it’s just sitting there doing nothing.
Make more money. That sounds a little glib, but increasing your income will give you more money to invest. So get your employer to pay you more – position yourself as an asset to the company by contributing your ideas or working harder to increase business. With more money coming in, you’ll have more money to invest!
Use other people’s money. If you have friends or colleagues with capital, get them to throw in with you to buy into mutual funds or purchase real estate and share the profits. But there are other sources of “other people’s money” out there – if you want to start or increase your own business, look into getting a loan from the Small Business Association (SBA). If you need venture capital for a new business, check out a Business Investment Company (SBIC) – these privately organized and privately-managed investment firms are licensed by the SBA to provide money for both new and established businesses. If your employer matches 401(k) funds, take advantage of that. If you receive a gift or an inheritance, consider it “free money” and sink it right into investments rather than spending it.
Use the equity in your home. It’s not always the smartest move, but you can use your home’s equity for investment capital. If you’re financially stable, don’t rely on investments to meet your mortgage payment and can earn more on investments than you’re paying on interest, you can dip into your equity to buy stocks, invest in mutual funds, or buy additional property that will earn income.
In all cases, it shouldn’t be a gamble – make sure your investments will bring you a solid return, and then get the capital you need to make a profit.